People walk across a bridge linking two DSTV Multichoice buildings in Randburg. FILE PHOTO: Karen Sandison/African News Agency(ANA)

JOHANNESBURG - The South African Broadcasting Corporation said on Monday it had noted with concern the Competition Commission's ruling on the R500 million agreement it entered into with pay-TV operator, Multichoice in July 2013, which has since expired.

The commission ruled that a channel distribution agreement between the SABC and MultiChoice constituted a notifiable merger and recommended that the two must file the agreement as a merger with respect to the encryption part of the deal, to avoid violating competition laws. 

The five-year agreement gave MultiChoice the right to broadcast SABC's 24-hour news channel and an entertainment channel, SABC Encore.

SABC spokesperson Neo Momodu said the public broadcaster had since entered into a new commercial channel supply agreement with Multichoice which in its understanding did not constitute a merger.

"The SABC board is reviewing the commission's recommendations in relation to the encryption part of the 2013 agreement and will respond appropriately in due course," Momodu said.

"The SABC remains committed to ensure compliance with applicable competition laws."

MultiChoice maintains that its 2013 agreement with the SABC was not a merger and says it will challenge the commission's decision.

African News Agency (ANA)